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PRINTER'S NO. 2065
THE GENERAL ASSEMBLY OF PENNSYLVANIA
SENATE BILL
No.
1346
Session of
2020
INTRODUCED BY KILLION, MENSCH, PITTMAN AND YUDICHAK,
OCTOBER 5, 2020
REFERRED TO LAW AND JUSTICE, OCTOBER 5, 2020
AN ACT
Amending the act of April 12, 1951 (P.L.90, No.21), entitled "An
act relating to alcoholic liquors, alcohol and malt and
brewed beverages; amending, revising, consolidating and
changing the laws relating thereto; regulating and
restricting the manufacture, purchase, sale, possession,
consumption, importation, transportation, furnishing, holding
in bond, holding in storage, traffic in and use of alcoholic
liquors, alcohol and malt and brewed beverages and the
persons engaged or employed therein; defining the powers and
duties of the Pennsylvania Liquor Control Board; providing
for the establishment and operation of State liquor stores,
for the payment of certain license fees to the respective
municipalities and townships, for the abatement of certain
nuisances and, in certain cases, for search and seizure
without warrant; prescribing penalties and forfeitures;
providing for local option, and repealing existing laws," in
distilleries, wineries, bonded warehouses, bailees for hire
and transporters for hire, providing for limited distributor
license.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. The act of April 12, 1951 (P.L.90, No.21), known
as the Liquor Code, is amended by adding a section to read:
Section 505.5. Limited Distributor License.--(a) Holders of
a limited distributor license may:
(1) Distribute and deliver special-order products directly
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to licensees of all types and, subject to the annual shipment
limitations specified under sec;tion 488(b), to consumers in
this Commonwealth.
(2) Determine the sales price of special-order products
offered for sale to licensees and consumers, which price shall
not be subject to the mark-up under section 305(a) or the
logistic, transportation and merchandising handling fee imposed
by the board.
(3) Establish minimum order quantities for direct delivery
and assess shipping and handling fees for third-party shipments.
(b) In order to be eligible for a limited distributor
license, the applicant must have total annual revenue of less
than twenty million dollars ($20,000,000) derived from sales
within this Commonwealth.
(c) Prior to issuing a limited distributor license, the
board shall require an applicant to:
(1) File an application with the board.
(2) Pay a registration fee of seven hundred dollars ($700),
pro-rated quarterly based on the application filing date.
(3) Provide to the board a true copy of the applicant's
current alcoholic beverage license issued by the board or
another state or country.
(4) Provide documentation which evidences that the applicant
has obtained a sales tax license from the Department of Revenue.
(5) Provide the board with any other information that the
board deems necessary and appropriate.
(d) The holder of a limited distributor license shall do all
of the following:
(1) Report to the board each year the total of special-order
products shipped to customers in the preceding calendar year.
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(2) Permit the board, the enforcement bureau or the
Secretary of Revenue, or their designated representatives, to
perform an audit of the holder's records upon request.
(3) Be deemed to have submitted to the jurisdiction of the
board, any other State agency and the courts of this
Commonwealth for purposes of enforcement of this section and any
related laws, rules or regulations.
(4) Allow customers to place orders for special-order
products by mail, telephone or on the Internet.
(5) Require proof of age of the recipient, in a manner or
format approved by the board, before a special-order product is
shipped to a customer.
(6) Ensure that all boxes or exterior containers of special-
order products shipped directly to a customer are conspicuously
labeled with the words "CONTAINS ALCOHOL: SIGNATURE OF PERSON 21
YEARS OF AGE OR OLDER REQUIRED FOR DELIVERY."
(7) Ensure that the delivery of special-order products
ordered through the limited distributor occurs by vehicle
registered in accordance with regulations of the board or
through licensed transporters.
(8) Pay to the Department of Revenue all taxes due on sales
to customers. The amount of the taxes shall be calculated as if
the sales were in this Commonwealth at the locations where
delivery was made. The special-order products delivered under
this section shall be subject to only the following:
(i) The sales and use tax imposed by section 202 and Article
II-B of the act of March 4, 1971 (P.L.6, No.2), known as the
"Tax Reform Code of 1971."
(ii) The sales and use tax imposed by Article XXXI-B of the
act of July 28, 1953 (P.L.723, No.230), known as the "Second
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Class County Code."
(iii) The sales and use tax imposed by the act of June 5,
1991 (P.L.9, No.6), known as the "Pennsylvania Intergovernmental
Cooperation Authority Act for Cities of the First Class."
(iv) The wine excise tax imposed under section 488(j).
(9) Annually renew its license by paying a renewal fee of
three hundred eighty-five dollars ($385).
(e) Any person who resells a special-order product obtained
under this section commits a misdemeanor of the second degree. A
person convicted of selling or offering to sell any special-
order product in violation of this section shall, in addition to
any other penalty prescribed by law, be sentenced to pay a fine
of four dollars ($4) per fluid ounce for each container of a
special-order product found on the premises where the sale was
made or attempted. The amount of fine per container shall be
based on the capacity of the container when full, whether or not
it is full at the time of sale or attempted sale. All special-
order products found on the premises shall be confiscated. The
prohibition on reselling special-order products shall not apply
to any entity who is licensed to resell special-order products
and who acquires the special-order product from a limited
distributor licensed under section 505.2.
(f) The wine excise tax specified under section 488(j) is
imposed and assessed on all special-order products sold and
delivered under this section. The tax shall be collected by the
limited distributor from the purchaser and shall be paid to the
department as provided under this section. Unless otherwise
specified, the tax shall be assessed, collected and enforced by
the department in the same manner as the tax under Article II of
the Tax Reform Code of 1971.
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(g) Receipts from the tax under subsection (f) shall be
deposited into the General Fund.
(h) The board may promulgate such rules and regulations as
are necessary to implement and enforce the provisions of this
section.
(i) As used in this section:
"Consumer" shall mean an individual who is a resident of this
Commonwealth, is at least twenty-one (21) years of age and
purchases wine for the resident's personal use and not for
resale.
"Special-order product" shall mean wine or spirits not
maintained in inventory by the board but that can be sourced
through a coordinated process with suppliers and shipped to
board store locations for pickup by the licensee or consumers,
or they may be delivered or shipped directly to licensees and
consumers. Minimum orders for direct delivery may be established
by suppliers and appropriate shipping and handling fees may also
be assessed for excess shipping or delivery costs.
Section 2. This act shall take effect immediately.
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